Would You Pay $85 a Month for Unlimited Espresso?

New York City is getting a new version of the bottomless cup of coffee.

A subscription-model coffee club, in which customers can pay a monthly fee to get unlimited java from selected cafes, launches Monday in the city after a successful run in Israel.

The CUPS mobile app is designed to compete with the smartphone-driven loyalty card programs offered by coffee giants Starbucks and Dunkin’ Donuts.

Not surprisingly, the price varies depending on the customer’s preferred high-end coffee. New Yorkers who prefer espresso will pay a monthly fee of $85 for unlimited coffee at about 40 independent cafes citywide.

A subscription from unlimited brewed, drip, pour-over or filtered coffee or tea is $45 a month.

Those who need a little less of a buzz can also purchase packages of five, 10 or 20 coffees per month with prices depending on the type of drink.

Similar to a MetroCard, the unlimited subscription has just one limitation–customers can buy only one cup every half hour.

And as a perk, anyone who signs up to the unlimited models will receive a month of free coffee.

The Coffee Club app

CUPS

“It’s kind of like the Starbucks app but for independent coffee shops,” said app co-founder Gilad Rotem. “It’s designed to give independent coffee shops that opportunity to compete with Starbucks and Dunkin’ Donuts.”

While most of the participating cafes are located in Manhattan, Wild in Williamsburg and Coffeed in Queens will also use CUPS.

The app will be available for download from the App Store or Google Play on April 14.

Andrew Hetzel, a coffee industry specialist who is a Board Member of the Specialty Coffee Association of America, said he thinks the CUPS model can be popular with consumers but has concerns about the “bottomless cup” concept from the perspective of
quality.

“My fear is that flat-rate pricing model will be a disincentive to the use of quality coffee and reduce overall consumption, making the app a poor value for consumers,” said Mr. Hetzel.

Mr. Hetzel said the New York specialty coffee scene was in its infancy just five years ago, far behind cities like Portland and San Francisco, but has recently blossomed into one of the most vibrant in the world .

“What has allowed so many coffee shops to flourish in New York is ‘specialty coffee,’ a concept driven by quality differentiation and,
not surprisingly better taste at a higher price,” said Mr. Hetzel.

CUPS launched in Israel in September 2012, and now partners with more than 80 cafes in Tel Aviv and has just launched in Jerusalem.

The business, which now employs 15 people, was the brainchild of five friends from high school, said Mr. Rotem.

“We’re all big coffee drinkers, but none of us is from a coffee industry background,” he said. “We try to give independent coffee shops the benefit of a franchise or network but we’re not taking away from their independent style.”